CAP TIMES: Chancellor Martin backs Walker's proposal to split off UW-Madison

February 17, 2011
Todd Finkelmeyer

UW-Madison Chancellor Biddy Martin sent an e-mail Wednesday night to the UW System's Board of Regents, and to other chancellors across the system, asking them not to oppose Wisconsin's flagship university breaking away from the system.

"There is nothing to be gained, in this economic and political environment, from opposing an innovative and helpful step that could move the entire system and state forward." Martin writes in the e-mail, which was obtained by the Cap Times.

Martin apparently has known for more than a month that Gov. Scott Walker's 2011-13 budget proposal would likely contain a provision that would not only give UW-Madison some key flexibilities and freedoms, but split the university from the UW System.  This was brought to light in a memo obtained by the Milwaukee Journal Sentinel.

The memo from Martin to Department of Administration Secretary Mike Huebsch dated Jan. 7 states: "I appreciate knowing that Governor Scott Walker wants to provide flexibility and intends to propose public authority status for UW-Madison. As I indicated when we met (Dec. 28), we will need to continue working with the leadership of our key internal constituencies, among them our key alumni, to ensure support for a proposal."

University of Wisconsin System leaders made it known earlier this week that they were concerned certain aspects of Walker's yet-to-be-announced 2011-13 biennial budget might allow UW-Madison to be spun off from the UW System.

Martin now is telling them to back off.

"When we were formulating our proposals last winter and presenting them in the summer and fall, it did not occur to me that changes to UW-Madison's place in the system could be entailed; I continue to believe that extending flexibilities to all UW institutions would be optimal," Martin e-mailed the regents and other system chancellors. "However, if the governor proposes flexibilities for UW-Madison, it would be irresponsible to forego the opportunity. It will enable the university to do what is required, namely, to generate revenue and use it in the most effective ways for the good not only of the university, but the state."

If the state's new Republican leadership ultimately pushes this proposal forward, UW-Madison would likely be able to: set its own tuition rates and manage those funds as it sees fit; put together its own budget without UW System approval; implement its own structure for recruiting, hiring and promoting employees outside the current state system; gain flexibilities in purchasing goods; and gain the authority to handle its own building projects without state oversight.

There is a history of creating such a "public authority" on campus. Back in 1995, Gov. Tommy Thompson in his 1995-97 biennial budget created a semi-private "hospital authority" to manage the University of Wisconsin Hospital and Clinics. Thompson's plan allowed the state to continue to own the hospital buildings and grounds.  However, the hospital does not receive general purpose revenue from the state, and funds it operations through revenues it generates.

University officials had long sought to free the hospital from state hiring and purchasing regulations, with former UW-Madison Chancellor Donna Shalala beginning the drive for privatization during her time on campus from 1988-93.

Martin has spent more than a year pitching her vision for a new relationship between the state and UW-Madison which would allow the university to retain its excellence in the face of impending budget cuts. Martin calls her proposal the New Badger Partnership. (For more background on Martin's proposal, click here.)

Other key elements of the public authority proposal outlined by Martin in her memo to Huebsch include:

** UW-Madison would have its own institutional governing body, separate from the UW System's Board of Regents, appointed by both the governor and UW-Madison.

** The university would maintain its existing level of state taxpayer support, minus any adjustments made for the 2011-13 biennium, "in the form of a block grant, which would increase at a rate of 2 percent per year in future biennia." In the current fiscal year, UW-Madison is receiving $476.5 million in state taxpayer support.

** Although UW-Madison would be the legal employer of all university workers, these employees would have the right to continue participating in the state health care and retirement plans.

** UW-Madison would retain its shared governance structure that is so important to faculty on campus.

** And although open meetings and public records laws would generally continue to apply, some exemptions might be put in place for proprietary research records and intellectual property.

If this proposal becomes reality, it would reverse the merger of the University of Wisconsin and Wisconsin State Universities system that happened in October of 1971.

Martin did not return a message seeking comment for this article, but released a statement earlier Wednesday addressing the UW System's concerns about UW-Madison being spun off.

"For the last 18 months, I have been advocating for greater flexibility for UW-Madison, and I have shared with Gov. Scott Walker the principles of the New Badger Partnership," Martin's statement reads. "I'm passionate about preserving the strength of the state's great research institution in whatever way possible. Given the state's serious economic challenges and the budget cut we expect to face, the greatest risk to the quality of this institution will be reductions in funding without the flexibility to respond in new and different ways. I believe it's critical that all UW institutions have the opportunity to benefit from such flexibility."

She adds: "I'm hopeful that when Gov. Walker introduces his budget next week that he'll include flexibility for UW-Madison and other UW institutions in some form. If UW-Madison were to be separated from UW System, the university could be a test case that paves the way for other institutions in the system to benefit from such flexibilities."

In a letter sent to Walker Tuesday, UW System President Kevin Reilly, UW Board of Regents President Charles Pruitt and board VP Michael Spector expressed "strong concerns about this significant restructuring, especially without broad consultation and careful deliberation."

That letter adds: "If changes are proposed that establish UW-Madison as a separate, self-contained institution with its own governance board separate from the Board of Regents, we would return to a two-tiered system the state abandoned 40 years ago for good reasons. Those competing systems gave rise to wasteful duplication, unnecessary competition, and conflicts. This resulted in higher costs to taxpayers and confusion for the State's elected leaders who had to weigh competing requests."

The UW System  — which includes 13 four-year universities, 13 freshman/sophomore UW Colleges campuses, and the statewide UW-Extension — is one of the largest public higher education systems in the nation. It serves more than 180,000 students and employs over 32,000 faculty and academic staff across Wisconsin.

Walker spokesman Cullen Werwie told the Associated Press Wednesday he couldn't confirm anything about the budget. "Lots of the details of the UW System, including funding and flexibility, will be released in the governor's budget, which will be introduced on Tuesday," he said.

Any proposals by Walker ultimately have to be approved by the Legislature.